Dipo Olowookere
By Dipo Olowookere
President Muhammadu Buhari has expressed his desire to put in place an efficient tax administration so as to improve tax revenue in the country and make payments attractive to taxpayers.
Mr Buhari, while declaring open the second National Tax Dialogue Week in Abuja on Tuesday, tasked participants to come up with initiatives that will improve tax administration in Nigeria.
He expressed worry over the multiplicity of taxes in the country, stressing that this was causing confusion among taxpayers, noting that this was why the government authorised the Federal Inland Revenue Service (FIRS) to be the sola agency to administer tax in Nigeria in the 2021 Finance Act.
According to him, the current tax system in the country is characterised by fragmented administration, multiple and sometimes, overlapping taxes.
“In most tax-efficient nations, tax administrative processes and practices are harmonised within a single system.
“One key deliverable of this year’s tax dialogue is to promote synergy in tax administration among the different tiers of government.
“Harmonising taxpayer identification across the country is a good start, but we must do more to promote ease of doing business (including ease of tax compliance) in Nigeria.
“On our part, we have started by clarifying in the 2021 Finance Act that FIRS is the sole authority to administer tax for the federal government.
“This clarification became necessary in order to avoid taxpayers being burdened with multiple tax compliance obligations towards different agencies of the same government.
“Multiplicity of tax administration is as undesirable as the multiplicity of taxes; it creates uncertainty and instability; and above all, it is inefficient,” Mr Buhari said.
At the event themed Tax Harmonisation for Enhanced Revenue Generation, the President further stressed the need to maximise domestic revenue within the extant tax policy and laws, tasking stakeholders to suggest ways to improve tax revenue without necessarily imposing new tax rates on Nigerians.
“We all know that good intentions are not enough as they simply cannot pay for infrastructure, security or social amenities. We must therefore improve tax revenue without necessarily raising new taxes.
“Revenue from commodities, including crude oil, are too volatile and unreliable. Therefore, I pledge government’s support for any viable initiative for improving tax revenue that should emanate from this dialogue,” he said.
President Buhari also said Nigeria must do more to expand its tax base so as to improve the tax-to-GDP ratio, which he lamented was too low at 6.0 per cent, “according to the Organisation of Economic Cooperation and Development (OECD), in its Revenue Statistics in Africa 2021.”
“It is obvious that much needs to be done in the area of tax revenue mobilisation.
“It is my expectation that the discussions at this 2022 National Tax Dialogue will be focused on what we must do to maximise legitimate revenue collection and massively improve the Tax-to-GDP ratio,” he said.
In her remarks, the Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, said the main tax revenue objectives of the federal government include developing an economy that does not lean too heavily on resource wealth.
“The right attitude towards taxation will enable every Nigerian to become a co-guardian of the tax system and the commonwealth,” she said.
On his part, the Chairman of FIRS, Mr Muhammad Nani, stated that, “Nigeria shall be the envy of other countries for tax compliance and domestic tax revenue mobilization.”
